Section 43B(h): The 45-Day MSME Payment Rule, Decoded

Pay a micro/small supplier late and your tax deduction shifts to the year you actually pay — inflating this year's taxable income.

The clock is 15 days with no written agreement, or up to 45 days if a written agreement sets the term.

It applies only to Udyam-registered MICRO and SMALL suppliers — medium enterprises and pure traders are outside the net.

The buyer need not be an MSME; even large companies and proprietors are caught when the supplier is micro/small.

Ask vendors for their Udyam number, tag MSME invoices in your books, and clear them before 31 March.